HomeMy WebLinkAboutOrdinance No. 3186-2021KENAI
CITY OF KENAI
ORDINANCE NO. 3186-2021
Sponsored by: Administration
AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, INCREASING
ESTIMATED REVENUES AND APPROPRIATIONS IN THE GENERAL LAND SALE
PERMANENT FUND TO TRANSFER EARNINGS IN EXCESS OF BUDGETED AMOUNTS TO
THE CITY'S GENERAL FUND.
WHEREAS, Article 5, Section 5-11 of the City's Charter, requires the proceeds from the Sale of
all City owned, non-trust lands be deposited in a separate fund, the General Land Sale Permanent
Fund, and allows for the investment earnings to be used for any lawful purpose but prohibits the
expending of the proceeds from land sales; and,
WHEREAS, the General Land Sale Permanent Fund's 2020 -year ending balance of $3,643,755
was an increase of $212,783 from the December 31, 2019 balance; and,
WHEREAS, the allowable transfer to the General Fund for operations is limited to 4% annually
and excess earnings are reserved to supplement spending when portfolio earnings are less than
the 4% limit in any given year; and,
WHEREAS, the December 30, 2020 earnings reserve balance was $692,062, thus the 2020
annual transfer is limited to $145,750 (4% of the Fund's value); and,
WHEREAS, after deducting the FY2021 allowable transfer, the earnings reserve balance will be
$546,312; and,
WHEREAS, the FY2021 budgeted transfer from the General Land Sale Permanent Fund was
$139,523 meaning the actual will be $6,227 more than budgeted and increasing the transfer
amount to the maximum amount is in the City's best interest.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA,
as follows:
Section 1. That the estimated revenues and appropriations in the General Land Sale
Permanent Fund be increased as follows:
General Land Sale Permanent Fund:
Increase Estimated Revenues —
Investment Earnings $6.227
Increase Appropriations —
Transfer to General Fund $6.227
Ordinance No. 3156-2021
Page 2of2
Section 2. Severability: That If any part or provision of this ordinance or application thereof to
any person or circumstances is adjudged invalid by any court of competent jurisdiction, such
judgment shall be confined in its operation to the part, provision, or application directly involved
in all controversy in which this judgment shall have been rendered, and shall not affect or impair
the validity of the remainder of this title or application thereof to other persons or circumstances.
The City Council hereby declares that it would have enacted the remainder of this ordinance even
without such part, provision, or application.
Section 3. Effective Date: That pursuant to KMC 1.15.0700, this ordinance shall take effect
immediately upon enactment.
ENACTED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 17th day of February,
2021.
ATTEST:
CMC,
Approved by Finance:
`� ��. /
•-
Introduced: February 3, 2021
Enacted: February 17, 2021
Effective: February 17, 2021
New Text Underlined; [DELETED TEXT BRACKETED]
KENAI
City of Kenai 1 210 Fidalgo Ave, Kenai, AK 99611-7794 1907.28&7535 1 www.kenaixity
MEMORANDUM
TO: Mayor Gabriel and Council Members
THROUGH: Paul Ostrander, City Manager
FROM: Terry Eubank, Finance Director
DATE: January 22, 2021
SUBJECT: Ordinance No. 3186-2021 — GLSPF Appropriation Increase
The purpose of this memo is to recommend passage of Ordinance 3186-2021. This Ordinance
will increase the authorized transfer amount from the General Land Sale (GLSPF) to the City's
General Fund for FY21. This increased amount is possible because earnings were higher than
projected for calendar year 2020.
GLSPF
Pursuant to KMC 7.30.020 (a) (5) the annual transfer from the GLSPF shall be limited to the lesser
of the cumulative earnings at calendar year end for the fund or four percent (4%) of the fund's fair
market value as of December 31st of each year. "Cumulative earnings" is defined as the market
value at calendar year end minus the fund's inflation adjusted principal balance.
The December 31, 2020 market value of the GLSPF was $3,643,755 with cumulative earnings of
$692,062.
December 31. 2020
Portfolio Value $3,643,755
4% of Portfolio Value $145,750
Cumulative Earnings $692,062
FY20 Allowable Transfer $145,750
The FY21 budgeted transfer amount was $139,523. This Ordinance will increase the budgeted
transfer amount to the maximum value of $145,750, an increase of $6,227.
Your support for Ordinance 3186-2021 is respectfully requested.